Magazines like the Economist, Forbes, Fortune, etc are filled with articles describing where the economy is and where it is headed (and where some companies & industries are and where they are headed)
But, for us to feel the need to read these articles, these magazines should prove that they are authorities on the subject and understand the economy.
It seems to me that they don’t really understand it though. In 2000, **after **the dot-com crash, they were filled with articles explaining how it happened and how it was practically inevitable. Well, if it was so obvious, why weren’t these magazines filled with articles predicting the dot-com crash?
Same with the economy today. Magazines are filled with articles explaining how it all happened (sub-prime mortgages, mortgage-backed securities, CDO’s, CDS’s, etc) and how, once you know the whole story, it was **bound **to collapse. Well, if it was bound to collapse, or even highly likely to come crashing down, why weren’t these magazines filled with articles about the coming collapse before it happened?
It’s like if you have a car and you keep making some major modifications to it, to improve its performance. You keep taking it to the mechanic once a month, who checks the car and declares it to be in good shape. Then, one day, your car explodes. You talk to your mechanic and he says, “well, of course it exploded, you added to much crap to it, it was bound to explode”. Well, why didn’t the mechanic tell you so before your car exploded, if he’s such a knowledgeable person about cars?
Same with these economic/financial magazines. If they are so knowledgeable about the economy, why weren’t they clear that this was a coming catastrophe?
It seems to be that either
a) They didn’t know because they are not that knowledgeable, in which case I shouldn’t be reading them
b) They did know, but due to their personal/financial interests, they didn’t want to tell anyone, in which case, again, I shouldn’t be reading them (because how can I know if what they are saying today is not correct, but simply put there to further the agenda of the authors)
What do you guys think? How do economic/financial magazines justify their existence, given the dearth of predictions before the fact and abundance of “explanations” after the fact?